Tom Price

With the exit in expense-account scandal of Tom Price, M.D., as secretary of health and human services, CMS may finally be allowed to update its star ratings of hospital quality, writes healthcare-sector consultant Rita Numerof, Ph.D., in Hospital Impact.

She notes that the ratings “evaluate provider performance across a variety of metrics, condensing the results into a single score. They offer the potential for patients and their loved ones to compare nearby facilities side-by-side, giving them the knowledge to ask important questions about their treatment, the process it is likely to follow, the costs they can anticipate, and the outcomes they can expect.”

“While the ratings were initially intended for quarterly updates and revisions, officials have stymied attempts to roll out a fresh review since July 2016. Just prior to Tom Price’s resignation from his post as Health and Human Services secretary, his department announced yet another push to delay the release of new ratings.”

“Though Price, a practicing physician, took a hard line against the ratings rollout, his potential successors may be more willing to revisit discussions on the system’s efficacy. Chief among them is CMS Administrator Seema Verma, whose work with Medicaid looked to combine institutional accountability with patient-centered care. It now seems that there may be a fresh opportunity to reopen the conversation on new ratings.”

Healthcare Dive looked at the future of for-profit hospitals in light of a Fitch Ratings analysis of the sector.

The news service wrote:

“After reviewing the finances of Community Health Systems, HCA Healthcare, LifePoint Health, Tenet Healthcare and Universal Health Services, Fitch Ratings said federal and state government policy decisions — which are often politicized — create an unpredictable environment. Federal regulations and political decisions are the biggest risks to the industry’s operating profile, with 30%-40% of hospital revenues coming from Medicare and Medicaid, according to the report.”

“Fitch said hospital revenues are also affected by consumer finances through high-deductible health plans (HDHP) and health savings accounts. Insurers and employers have been able to slow premium increases by using HDHPs, but these plans have also saddled members with more out-of-pocket costs.”

In what might be seen as further evidence that Health & Human Services Secretary Tom Price, M.D., is taking a much more pro-physician stance toward physicians paid by Medicare than his predecessors, the Centers for Medicare & Medicaid Services (CMS) is, in the words of Medscape “lightening the audit burden on physicians by rolling out a new approach to claims review that targets fewer providers and requires the review of fewer claims than the current approach does. This new policy reduces the likelihood that physicians who follow sound billing practices will be audited.”

“CMS explained that it was revising its medical review process to target only specific providers or suppliers who have billed Medicare for particular services, rather than all of them. Referring to the two-step process of identifying providers who have made billing errors and then educating them, the agency calls this new approach Targeted Probe and Educate (TPE). It replaces the current Probe and Educate program, which began in 2014 and targets all providers who bill for particular services or items.”

U.S. Health and Human Services Secretary Tom Price, M.D., has defended massive budget cuts proposed by the Trump administration for his department’s services by saying that government spending doesn’t equal government success.

“If how much money the government spends on a program were truly a measure of success, Medicaid would be hailed as one of the most successful in history,” Dr. Price told the Senate Finance Committee in a hearing. He noted that a a third of U.S. physicians don’t take Medicaid patients, and that Medicaid coverage does not necessarily translate into better medical outcomes for individual patients.

Governing magazine looks at how six states –Arizona, Arkansas, Florida, Kentucky, Maine and Wisconsin — plan to revamp their Medicaid programs in the Trump era. The article says:

“While the Republican-controlled Congress is trying to repeal the Affordable Care Act (ACA), governors on both sides of the aisle are anxiously awaiting to see what happens. In the meantime, some are trying to make their own changes to the health-care system in their state — and have the best chance of doing so in years.

“To customize their Medicaid programs, states have been able to ask the federal government for waivers for decades. The Obama administration rejected many waivers, concluding that they were unconstitutional or would drastically limit poor people’s ability to afford health insurance. For example, many states sought to make employment a requirement for Medicaid, but the Obama administration declined every such request.

“With Donald Trump in the White House and Tom Price leading the Health and Human Services (HHS) Department, conservative states will likely see their long-denied wishes come true. Both officials support giving states more flexibility than the Obama administration, and a final bill to replace the ACA would likely increase states’ power as well. So in the early days of the Trump administration, some governors enthusiastically submitted waivers.”

“If some of these proposals get the greenlight as expected, they could drastically change the structure of Medicaid in their states and have national implications.”

Now that the GOP effort to repeal and replace the Affordable Care Act is in limbo, is there a way to make it work better?

Democrats and Republicans don’t agree on much when it comes to the controversial federal health law, but some party leaders from each side of the aisle agree it needs repairs.

“No one ever said the Affordable Care Act was perfect,” said Senate Minority Leader Chuck Schumer (D.-N.Y.) on the Senate floor March 27. “We have ideas to improve it. Hopefully our colleagues on the Republican side do as well.”

A day later, Speaker Paul Ryan (R-Wis.) said, “We all want a system in healthcare where everybody can have access to affordable coverage, where we have more choice and competition.” And several GOP senators have moved away from the party’s long-held call for a total repeal and are offering bills that would amend the measure.

Health-policy analysts say that some of the health law’s marketplace problems could be improved with a bipartisan spirit. Here are some of the possibilities:

Stabilize the Insurance Market

Insurance companies have only a matter of weeks before they must tell the federal government and/or individual states whether they plan to offer coverage in 2018 on the health law’s online marketplaces, which serve customers who don’t get job-based or government insurance.

As of now, many companies say the uncertainty of what the market will look like — or the rules under which they will operate — is making that decision difficult. At least one insurer, Humana, has already said it would not offer coverage.

Two key moves that insurers are looking for from the administration are a promise to continue providing certain subsidies for those with lower incomes and enforcing the requirement for most people to either have insurance or pay a tax penalty.

The subsidies — known as “cost-sharing reductions” — are different than the tax-credit subsidies that many marketplace customers get to help pay their premiums. The cost-sharing subsidies help those with incomes between the poverty line ($20,420 for a family of three) and nearly 2½ times that ($50,400 for that same family) pay their deductibles and other out-of-pocket costs. The House sued the Obama administration in 2014 for providing the subsidies without a formal congressional appropriation for the money, and a federal judge sided with the lawmakers.

The Obama administration appealed the decision, but if the Trump administration were to drop that appeal, the subsidies would disappear. At a House hearing March 29, Health and Human Services Secretary Tom Price, M.D. would not say what the administration plans to do about the lawsuit or the subsidies.

“I’m a party to that lawsuit and I’m not able to comment,” he said. But Ryan, who is also a party to the suit, said March 30 that he believes the administration should continue paying the subsidies until the lawsuit is resolved.

The administration has been similarly quiet about how strictly it will enforce the “individual mandate” that requires most people to have health insurance or pay a fine. On his first day in office, President Donald Trump issued an executive order directing federal agencies to “minimize the unwarranted economic and regulatory burdens” of the health law. But other than the IRS backtracking on a plan to enforce the mandate more strongly, little has happened on that front.

Yet those two provisions together — the cost-sharing subsidies and the individual mandate — could result in 25 to 30 percent increases in premiums if they were to disappear, said Andy Slavitt, who oversaw the health law for the final years of the Obama administration. Assuring that the subsidies will remain and the mandate will be enforced “would send a strong signal to (insurance companies) that they should continue to participate in the market,” he added.

Some GOP health policy analysts — including economist Gail Wilensky, who previously ran the Medicare and Medicaid programs — have proposed replacing the individual mandate with penalties for signing up for insurance late, which is what Medicare does. Republicans did that in their proposed replacement bill, by adding a 30 percent premium surcharge to those with a break in coverage longer than two months. But insurance actuaries and the Congressional Budget Office said that might eventually prompt fewer people to enroll because it would encourage healthy people to remain uncovered.

Entice People to Enroll

Getting young and healthy people to sign up for coverage is not just a benefit for them. If there are not enough healthy people in the insurance pool, then premiums rise for everyone, because risk is being spread across a mostly sicker population. And someday even the healthy people will need medical care.

But it takes more than just the requirement for coverage to get people to enroll. Slavitt said it requires a real effort by both federal and state officials to reach people and help them understand that having health insurance is a good thing, even if they are healthy. “What they should be doing is increasing marketing and the outreach budget,” he said. “You’re trying to reach people who are uninsured and are unsure how it all works, and it does take a lot of hand-holding.”

So far, however, the administration’s only move on that front was to cancel ads encouraging people to sign up at the end of the enrollment period that overlapped with Trump’s first days in office. The HHS Inspector General is now investigating the results of this action. Some analysts have estimated canceling the last-minute push lowered enrollment in the exchanges by as much as a half-million people.

Help Offset Insurer Losses

Democratic lawmakers who wrote the Affordable Care Act knew that the market might be hard for insurers to navigate for the first few years, and they built in several programs to help reimburse those who lost money.

Republicans, however, blocked funding for one of the major programs, which was intended to reimburse insurance plans that enrolled sicker-than-average populations for the first three years of the marketplace operations. Republicans called the money “insurer bailouts.” The loss of that money was a major reason for the collapse of many of the nonprofit insurance co-ops created under the law and some other insurance companies said it contributed to their decisions to leave the marketplaces.

Now, however, there are indications that Republicans might support some efforts to provide more funding for insurers.

On March 13, Price sent a letter to governors encouraging them to apply for waivers of the ACA rules in order to make insurance more affordable and available in their states. Among the state innovations singled out in the letter is a “reinsurance” program in Alaska that helps insurers pay for extremely high-cost patients. That plan, said Price, “significantly” offset what was a projected 40 percent premium increase in the state, and might be an option elsewhere under the waivers, which could allow states to get federal funding for such a program.

“They have a potential fix staring them in the face,” said Larry Levitt of the Kaiser Family Foundation of the GOP proposal for a stability fund. “It was a clever mechanism because the states could use it for any of a variety of purposes.” (Kaiser Health News is an editorially independent project of the Foundation.)

Assist Patients With High Out-Of-Pocket Costs

Democrats and Republicans agree that people who buy their own insurance are paying too much out-of-pocket, in premiums as well as deductibles and cost sharing.

Democrats mostly want to increase federal subsidies to help with affordability — something Republicans are not likely to embrace.

But there are other ways to lower consumer spending.

For example, Sabrina Corlette of Georgetown University’s Center on Health Insurance Reforms, calls for “smarter, not skimpier benefit design.” One way to do that is to set federal rules to push insurers that offer coverage with high deductibles to add more benefits that would be available without paying thousands of dollars first, like a few trips to the doctor or urgent care center or a few prescriptions. She writes that could keep people from dropping coverage because they feel they are not getting any value for their premiums. And if those mostly healthy people feel they are getting benefits they might use, they are more likely to continue to purchase coverage, thus reducing premiums for everyone.

Another potential way to lower insurance costs is to lower health care costs. Even if there are multiple competing insurers in an area, if there’s one dominant hospital system, it can pretty much charge whatever it wants.

“There’s no other price in the U.S. economy that’s growing as fast as a hospital price,” said Bob Kocher, a former Obama administration health official now at the venture capital firm Venrock. And in areas with not much hospital competition, “prices are 30 to 50 percent higher for everything.”

But how to get hospital prices down is almost as hard as regulating insurance. Kocher said one way would be for federal regulators to be more discriminating about approving hospital mergers, which tend to give hospitals more negotiating power over insurers.

More controversial would be to require hospitals that dominate their markets “to just accept Medicare prices” from marketplace insurers, Kocher suggested. While that would tend to bring prices down, it’s not likely to fly with free-market Republicans.

Billy Wynne, writing in Health Affairs, presents five lessons from the failed launch of the American Health Care Act:

They are:

“Nothing is inevitable”

“There’s a difference between making a political statement and enacting real policy. The latter is invariably complex and time-consuming, creating vulnerabilities and pitfalls both known and unknown at the outset. While a cornerstone of tried and true policymaking is to leverage the ‘strategy of inevitability’—more than seven years ago, the ACA campaign itself vigorously deployed just such a strategy—the underlying premise of that strategy is always inherently false.’’

“Stakeholders matter’’

“Virtually every hospital and hospital group, every physician group, nurses, patient groups representing the young, old, disease-stricken, and disabled, and many others fervently opposed AHCA. They added analysis of AHCA’s impact on them, as governors did regarding its impact on their states. At the end of the day, this was simply a bad bill. Stakeholders figured it out and acted when it counted.’’

‘’Ultimately, on the day AHCA was originally supposed to get its final House vote, a Quinnipiac University poll came out showing only 17 percent of the public supported the bill, while 56 percent opposed it, a startling gap rarely seen in any bona fide political polling.’’

“The ACA stole most of the good conservative ideas’’

‘’While it was lambasted by Republicans as the manifestation of a Marxist dystopia, the truth of the ACA is that it is a very moderate law. …As Health Policy Counsel to then-Finance Committee Chairman Max Baucus in the prelude to President Obama’s election, I know the pains he took to build bipartisan consensus. In 2008, he negotiated with Republican counterparts on reforming the market for small businesses, in what became the SHOP Act component of the ACA (drawing from legislation originally co-led by Republican Olympia Snowe). He convened an all-day, fully bipartisan Prepare to Launch summit to query experts and debate ideas. He released a series of white papers that laid out detailed policies he believed could gain bipartisan support (welcomed by the conservative Heritage Foundation as ‘a starting point for serious discussion’). And all of that was before President Obama was elected.”

‘’The centerpiece of the ACA became tax credits for the purchase of commercial—not government—health insurance, with a tax-driven mandate that everyone take responsibility for buying in. This had been the linchpin of numerous Republican health reform proposals prior to that time. While Medicaid expansion was also included, it took on a greater role only because that is a less costly way to expand coverage, and Democrats were utterly committed to ensuring the bill did not increase the deficit.”

‘’Other key conservative ideas were embedded in the law as well. Numerous new payment reforms were instituted to drive efficiency and lower costs; states were allowed to pool their markets (though notably none have yet); price and value transparency was instituted so consumers could compare their coverage options side-by-side; emphasis was placed on prevention and community health centers; states were free to run their own exchanges and establish their own essential health benefits; dozens of new program integrity and oversight protections were instituted.’’

“Tom Price is now the most important person in healthcare”

“While the Trump Administration has some more thinking to do before it commits to letting our health care system crash and burn, via sabotage or neglect, it certainly has that power. The locus of that power is the Department of Health and Human Services and its Secretary, former Republican Congressman Tom Price, M.D., a former orthopedic surgeon.

‘’As we have already seen, simple maneuvers like pulling publicity for HealthCare.gov and creating an aura of uncertainty can adversely impact insurance enrollment. Payment and delivery system reforms, intended to lower costs and improve quality, have been halted in their tracks. Governors have been informed that they are now freer to impose premiums and increase cost-sharing for Medicaid enrollees.

“As destabilizing as these changes are, they pale in comparison to some of the more nuclear options Secretary Price has at his disposal to wreak havoc on health care. Perhaps the foremost of these, and the one readily accessible at any moment, is the option to refrain from defending the cost-sharing subsidies.”

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“Bipartisanship is still possible’’

“While not as expedient or gratifying to the inner ideologue inside us all, the long, frustrating work of compromise is the only viable path forward.

‘’There is a lot of lower-hanging fruit and we should give AHCA credit for bringing some of those to people’s attention. Insurers have now made clear what they think will help stabilize markets and perhaps make them more competitive, including funding risk corridor and reinsurance programs. Meanwhile, several start-up health plans are eyeing a wide array of markets where competition is limited and ripe for a lower-cost competitor. Some have faced obstacles at the state-level, undoubtedly due in part to the objections of entrenched interests. Can a Price-led HHS help open up these markets?’’

The CMS has delayed the expansion of a major bundled- payment pilot, Comprehensive Care for Joint Replacement, and implementation of its bundled-payment initiatives for cardiac care to Oct. 1, 2017, from July 1, according to an interim final rule posted to the Federal Register. It also again delayed the effective date of a final rule detailing the implementation process for CJR and other bundled-payment programs, to May 20, 2017 from March 21.

The agency is considering delaying implementation of all bundled-payment initiatives even further, until 2018.

Modern Healthcare speculated that the Trump administration’s “move to delay these initiatives raises questions about the future of government initiatives to usher healthcare out of fee-for-service operations and into a new age of value-based payment.”

The new secretary of health and human services is Tom Price, M.D., who had a very lucrative career as an orthopedic surgeon and has been a major investor in some medical companies. CMS ultimately reports to him and President Trump.

Seema Verma, nominated by President Trump to lead the Centers for Medicare & Medicaid Services, told her confirmation hearing at the Senate Finance Committee that she’d consider clawing back parts of a rule set during the Obama administration that overhauled Medicaid managed-care programs.

She also said he doesn’t want to turn Medicare into a voucher program, an idea backed by Health and Human Services Secretary Tom Price, M.D., and thinks that rural healthcare providers shouldn’t face risk in alternative-payment models.

Ms. Verma said that one of her priorities would be re-assessing a rule issued under the Obama administration that ordered states to more vigorously oversee the adequacy of Medicaid plans’ provider networks and encouraged states to establish quality rating systems for health plans. She raised the question of whether these mandates have overly burdened the states financially.

On Medicaid, she said that “the status quo is not acceptable.”

“I’m endorsing the Medicaid system being changed to make it better for the people relying on it … and whether that’s a block grant or per capita cap, there are many ways we can get there.”

On Medicare, Modern Healthcare reported that Sen. Ron Wyden (D.-Ore.), the ranking Democrat on the Finance Committee, “said that she sounded like she wanted to keep Medicare a fee-for-service system.” The CMS under the Obama administration set goals to move Medicare away from fee-for-service, which was viewed as prone to abuse and fraud even as it has been very lucrative for physicians and hospitals and encourages much medically unneeded ordering of tests and procedures to maximize providers’ income.

But Ms. Verma denied Senator Wyden’s assertion and said that she supports Medicare focusing more on quality of care instead of volume.

The confirmation of Tom Price, M.D., the orthopedic surgeon-turned-Georgia congressman, as secretary of Health and Human Services represents the latest victory in the ascendancy of a little-known but powerful group of conservative physicians in Congress he belongs to — the GOP Doctors Caucus.

During the Obama administration, the caucus regularly sought to overturn the Affordable Care Act, and it’s now expected to play a major role determining the Trump administration’s plans for replacement.

Robert Doherty, a lobbyist for the American College of Physicians, said the GOP Doctors Caucus has gained importance with Republicans’ rise to power. “As political circumstances have changed, they have grown more essential,” he said.

“They will have considerable influence over the considerable discussion on repeal and replace legislation,” Doherty said.

Price’s supporters have touted his medical degree as an important credential for his new position, but Price and the caucus members are hardly representative of America’s physicians in 2017. The “trust us, we’re doctors” refrain of the caucus obscures its heavily conservative agenda, critics say.

“Their views are driven more by political affiliation,” said Mona Mangat, M.D., an allergist-immunologist and chairwoman of Doctors for America, a 16,000-member organization that favors the current health law. “It doesn’t make me feel great. Doctors outside of Congress do not support their views.”

For example, while the American College of Obstetrics and Gynecology has worked to increase access to abortion, the three obstetrician-gynecologists in the 16-member House caucus are anti-abortion and oppose the ACA provision that provides free prescription contraception.

While a third of the U.S. medical profession is now female, 15 of the 16 members of the GOP caucus are male, and only eight of them are physicians. The other eight members are from other health professions, including a registered nurse, a pharmacist and a dentist. The nurse, Diane Black of Tennessee, is the only woman.

On the Senate side, there are three physicians, all of them Republican.

While 52 percent of American physicians today identify as Democrats, just two out of the 14 doctors in Congress are Democrats.

About 55 percent of physicians say they voted for Hillary Clinton and only 26 percent voted for Donald Trump, according to a survey by Medscape in December.

Meanwhile, national surveys show doctors are almost evenly split on support for the health law, mirroring the general public. And a survey published in the New England Journal of Medicine in January found almost half of primary care doctors liked the law, while only 15 percent wanted it repealed.

Rep. Michael Burgess, R-Texas, a caucus member first elected in 2002, is one of the longest serving doctors in Congress. He said the anti-Obamacare Republican physicians do represent the views of the profession.

“Doctors tend to be fairly conservative and are fairly tight with their dollars, and that the vast proportion of doctors in Congress [are] Republican is not an accident,” Burgess said.

Price’s ascendancy is in some ways also a triumph for the American Medical Association, which has long sought to beef up its influence over national health policy. Less than 25 percent of AMA members are practicing physicians, down from 75 percent in the 1950s.

Price is an alumnus of a boot camp the AMA runs in Washington each winter for physicians contemplating a run for office. Price is one of four members of the caucus who went through the candidate school. In December, the AMA immediately endorsed the Price nomination, a move that led thousands of doctors who feared Price would overturn the health law to sign protest petitions.

Even without Price, Congress will have several GOP physicians in leadership spots in both the House and Senate.